Tamilnad Mercantile Bank's Q1 FY27 net profit soars 35% to Rs 412 cr.

Tamilnad Mercantile Bank (TMB) posted its highest-ever quarterly net profit of Rs 412 crore for Q1 FY27, a 35% YoY growth. Net interest income rose 32% to Rs 765 crore, and total business surpassed Rs 1.21 lakh crore, up 23% YoY.

Tamilnad Mercantile Bank (TMB) has reported its highest-ever quarterly net profit of Rs 412 crore for the first quarter ending June 30 (Q1 FY27), registering a robust 35 per cent year-on-year growth. The bank's stellar performance was anchored by a 32 per cent Year-on-Year surge in net interest income (NII) to Rs 765 crore, while operating profit expanded 48 per cent Y-O-Yto reach Rs 611 crore.

Total business crossed Rs 1.21 lakh crore, up 23 per cent y-o-y, significantly outperforming broader industry growth trends. Advances grew 27 per cent yearly to Rs 57,306 crore, led by retail, agriculture, and MSME (RAM) loans, which rose 28.5 per cent y-o-y to Rs 54,083 crore--constituting 94.4 per cent of the bank's total loan book. Total deposits increased 20 per cent y-o-y to Rs 64,409 crore.

Record Performance and Business Growth

Highlighting the bank's operational momentum, Salee S Nair, Managing Director and CEO of Tamilnad Mercantile Bank, said, "This has been a very interesting quarter for us, demonstrating the acceleration of efforts put in place over the last several quarters. Delivering 23% business growth compared to our historical CAGR is the highest in 14 years and over 7 percentage points above industry levels. It is also the highest-ever net profit in the bank's history, crossing the ₹400 crore milestone for the first time while keeping credit costs well under control."

Superior Asset Quality and Prudent Risk Management

Asset quality remained best-in-class, with gross NPA declining to 0.69 per cent and net NPA to 0.17 per cent. Demonstrating prudent risk management, TMB fully provided 100 per cent against its stressed non-fund-based (NFB) exposures ahead of the upcoming Expected Credit Loss (ECL) regime. Return on Assets (ROA) improved to 2.14 per cent, Return on Equity (ROE) expanded to 15.93 per cent, and Capital Adequacy (CRAR) remained robust at 32.33 per cent.

Digital Adoption and Infrastructure

Elaborating on digital adoption and infrastructure initiatives, Nair said, "Our IT investments are resulting in significant process automation. While overall business grew 23%, manual branch transactions dropped noticeably, with 97.4% of total transactions now occurring through digital channels. We are heavily investing in our digital hubs, AI-driven automation, and cyber security to drive productivity and protect customer interests."

Portfolio Growth and Future Strategy

TMB's gold loan portfolio reached Rs 27,404 crore, while FCNR(B) deposits grew to Rs 825 crore. Management re-affirmed its strategy to deepen its regional footprint across South India, Maharashtra, and Gujarat while maintaining strong capital headroom. (ANI)

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